Accounting Multiple Choice Question – 7 December 2021

The table shows information from a company’s accounts.

• Turnover – £135k
• Gross profit – £34k
• Profit before interest and tax – £11k
• Profit after tax – £8k
• Fixed assets – £59k
• Current assets – £50k
• Debentures – £12k
• Current liabilities – £40k

What is the return on total capital employed?

Select ONE answer:

1. 8.1%
2. 11.3%
3. 14.0%
4. 15.9%

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct ==> A=L+C ==> £59k + £50k – £12k – £40k = £57k + £12k ==> Capital Employed ==> PBIT / CE ==> £11k / £69k = 15.9%

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